>> bp/is spending and oil prices plunge. >> australia joins the global easing party with new record lows. >> obama's plan sets up the fight with congress of the >> pass the budget that funds the national security priorities and gives middle-class the security they need to get ahead. >> the bloomberg exclusive on

why google could be turning into movers competitive -- competitor. welcome. >> will get a chance to see the impact of lower crude prices. bp reports earnings. >> the earnings are due in under an hour with the backdrop of the employee pay freeze. >> the central bank became the latest to cut the interest rate overnight in response to the deflationary impact of the tumbling oil prices. we will have more on that. let's go to ryan chilcote in london. i believe that it is snowing outside. you can tell us in a moment.

capital expenditure and dividends. >> yeah. what is falling faster? the oil price or the snow. perhaps it is the oil price. look, we have seen the earnings and we will be looking at the oil prices and the expectation on fourth-quarter profits dropping. nothing particularly surprising about that. they all reported profit declines and the oil price fell. they have a unique problem with exposure to russia and it will be interesting to see how the ruble the valuation affected profits there.

we will have to see if they get anything this time around. one of the things the oil companies have been doing -- wow, the snow is picking up. they have been cutting expenditures. they said that they expected to spend 23 billion this year. less will be a indication of cuts. one of the things is the whole issue of the receiving end of the him monday. there is no reason why they could be. >> let's talk about the dividend. the conversation last week said the conversation on dividends is

safe for now. we may get shocked. >> absolutely. >> i think it was early for him to sacrifice the dividend. particularly bp, the yield was very attractive and i do not think that doubly wants to change that. he did send me oil prices would remain low and it is how he is going to protect the dividend. you have growth you can sacrifice with cutting back on spending and looking for efficiencies. then, there is the dividend. anything below 22 billion in

spending means a sacrifice of growth going forward. we were talking to an analyst who talked about exxon and the low companies would sooner cut their chairman space than the dividends. analysts say that it is under threat with the oil prices linger, unless they announce the entrance solution to the cash issue. back to you. >> it is officially snowing. >> we have breaking news with the banking business coming in line with estimates and the prioritizeing is organic growth

by just a fraction said september and it is down. she took over from her late father back in september. remember that this company tapped investors and they have a lot of business in spain and the u.k.. this has been a bit of a headache for them as blade. >> back to oil and plunging crude prices. joining one dozen counterparts in easing with deflation risks -- >> is it safe to say this is a surprise. >> it depends on who you are. there is a 50% chance of the

rate coming and only seven out of 29 of the economists think they would cut the rate. they did and here is what they had to say. they said the growth was leading towards unemployment rising and the australian dollar is weaker. there is a decline in commodity prices. there is a basket of currencies and the cut puts a ceiling on the dollar. it fell steeply. it is down 1.5 cents since the announcement. it rose on the aftermath and the rva is not concerned with

housing. this will throw a bucket of gas on that and they are not concerned. >> is it likely they will cut again? >> they have formed to deliver the punch and many analysts including those who did not expect a cut, are forecasting one and the treasurer is pleased with the developments, saying it is good news for families and it will put more money in pockets. he says there is room to move and many expect another cut coming in march. >> just a reminder, we had another rate decision and there were no surprises.

>> they are not all surprises. let's get some of the other stories that we are following. obama has a budget that would raise taxes on corporations and it would stabilize and not eliminate the annual budget deficit. analysts say it is unlikely that the congress will approve. >> the budget is built on the values and it helps working families go further by adding sick leave and childcare. it gives americans a chance to operate skills to earn higher wages and includes a plan to make community college free for responsible students. it lets us keep building the

most attractive economy for highway drops -- jobs. and expands access to faster internet and new markets for goods in america. >> news corp. for off he prosecuted for phone hacking in the united states. the department of justice have been investigating. also, where there alleged payments? the department says it does not see any changes and is closing the investigation. >> google is developing a new taxicab app. there have been screenshots of

what appears to be a ridesharing cap used by google employees. google invested in huber. the company may become a competitor rather than an ally. you can see it on bloomberg.com. there it is. >> you can join the conversation and let us know what you think of these stories we're covering. if you want to throw any money in the hat to buy ryan chilcote an umbrella, it is welcome. >> we will send one to him. another bloomberg exclusive. carmaker chief executives on the russian economy is up after the break.

>> time for company news. a new crossover vehicle. the chief executive speech exec -- exclusively to bloomberg about the decline in the russian auto market and says that shales -- sales have declined by a third in two years.

>> more than 11% declined and russia would be followed by a forecasted decline of 20%. it is already pretty bad. i think the forecast that we had we should be hopefully, at the end of the tunnel. you never know. >> apple had a major offering of debt and is issuing the equivalent of $39 billion in bonds in april and the proceeds will be used for software purposes, dividends, and debt repayment. lenovo surged and profits beat with smartphone sales. they expanded their share of the

global smartphone markets and it was $2.53 million in the quarter. >> in london, the greeks are standing down. they are calling for a swap instead of a right down to appease the creditors. government borrowing costs surged last week. it is good to see you. help was understand what is going on. if you are swapping one for another, we assume the new is different than the old. is this a haircut by another name? >> there is wonder if there ever will be. we are in a bit of a volatile situation and there is the

extreme view that maximizes their bargaining position. there is volatility and a lot of rhetoric. >> it is interesting to see how the markets have reacted this time around. the government bonds are up and you will get the borrowing. portugal is up. i am being naive. is there a firewall? the bond markets do not seem shaken. >> there is less impact than there would have been in 2011 or 2012. there is about 320 billion euros of greek debt and almost all of it is the es ff. the banks do not have as much

exposure to it and it would be more contained than it would have been in 2011. >> you do know that there was a debt restructuring in 2012? three yields -- the yields, what is the market telling us? >> back in 2011 and 2012, the debt went into restructuring and when short on the banks. if it did not work out, we knew the banks would get hit. it was one versus the other. right now, you cannot trust what he says. i do not know if he will pay back as he said. >> 19%? >> not right now. i think next month will have

more volatility and towards the end of the month, we will see it. >> there is greek growth. >> that is to the ecb and they are looking at that. it is the very first capital repayment. what they are doing right now is magic means and they have to deliver on that. >> is a greece are germany? when the economy is in freefall there has to be a growth strategy and not just the effort to squeeze more out. the americans have been calling on europe to do more. >> what the u.s. has done is combined monetary policy with fiscal stimulus and

restructuring. it has been very effective and the u.s. model has shown growth and stability. >> let's talk about the next bank to fall in line. the reserve bank of australia joins the crowd. the commodity currency is under pressure. how do you look at that in that context? >> you do not have to check on the growth, except for the united states. they came below expectations a couple of days ago and china is slowing with falling oil prices. you can clearly so -- see why there is economic growth below where they want it. >> that is the biggest short in the u.s. ever. >> wide?

>> you are going into an environment where everywhere else is cutting rates. you have the united states as the lone standout fighting the fed. you are paying premium multiples for that. the strong dollar is the impact. >> you have google, apple, and microsoft extending their lead over the second-biggest company. >> yes. no doubt. >> and, you look at it in multiples and it is the dominant consumer discretionary company getting a gross margin and it is very profitable. everything i just said would command a premium. >> not even the size of a small country now.

thank you. we're taking a short break and it is a little snowy outside.

>> welcome back. let's go back to the managing partner. patrick, i am looking at commodities and you are adding

to this in gold. why have you added to the short position? >> we just put that out on friday. we expect yields to be low and it creates a bit of a head wind. and there is a strong fall in oil prices. >> along on the norwegian krone. >> you have seen that and with the swedish krona.

sweden is in debt. and we think that is going to wrap things up. that is quite well this year. >> we talk about you being short on equities and we want to see the fed tightening. >> we are going to see china once or twice this year and the chinese equities are paying and you will have central-bank stimulus for china and you are getting better growth. a much cheaper multiple. >> great to have you with us. >> 6:26 in london. obama is drawing a wedge between republicans on taxes and spending with his budget.

>> you are watching countdown. time to check in on the foreign exchange market. he wanted something for christmas and he wanted a lower currency and he got it. it is trading at a 5.5 year low against the dollar. singapore dollar is at the lowest level since 2009. this was a surprise to analysts.

a 25 basis point cut with lower rates needed and the lower exchange rate needed. the whole world is cutting rates. three have eased and i love what was said. feel free with the currency at $.70. it is dropping to the lowest level since 2013 and that is the story here. the equities are hesitant and the yen is moving higher with the disease and the equity markets. the good work that was done is coming to naught and they are losing superiority with the line on the dollar yen this morning. they decided to hold firm and it would be lower.

they left the rates unchanged and there was a surprise revision. 31 out of 41 thought they would leave the rates are unchanged. morgan stanley is getting rave for rates to hit. that will be at 7.5%. >> these are the ones this hour. the budget would raise taxes on the top earners and spend more on infrastructure and housing. >> america cannot afford being shortsighted. the budget i sent is paid for

through spending cuts and tax reforms. >> rupert murdoch's news corps will not be prosecuted. the department of justice has been investigating whether any of the hacking has taken place. and the department says they are not pursuing any charges and are closing the investigation. the greek finance minister outlined plans for a debt swap. there was borrowing for new bonds and that is a change for the coalition that had been calling for the euro area to write down grecian debt. >> i have fatigue.

a nice play on words. as is uber did not have adversaries. there are well regulated competitors and a new potential threat. here with more is caroline hyde. what is the story? google -- are they looking to get in on uber? what's it seems like all is fair in love and war. luckily, in conjunction with the project's to everyone's excitements. it was assumed they would work together. the investment arm of google put a quarter million dollars into uber and put even more money in

the 2014 fundraiser. david drummond, the chief legal was on the board and we understand the same executive on the board had informed they might be looking at doing their own. we apparently understand that they had seen a screenshot of it already working and they are saying that google is developing the rates and they have their data. why not just make a sharing app? google has made no secret of their ambitions to get driverless cars and we could

have them. it seems like they have a complicated relationship and they are more friend amienemies. >> they are doing research. where are we with this? >> a gets more kabul kid. we learn that they are asking to get rid of him and want him to resign. he is an employee who sits on the board. now the complication grows and they unveiled that they are analyzing the research and development into autonomous vehicles and they have launched a advanced technology center

where they will do mapping into the occult safety and google is a great investor. they may have too much and the drivers use google maps and they are not entirely dependent on google. why will we need taxes? you go to work and if somebody puts a question on taxi services and what becomes a main play -- >> it is hard. >> if they go they may need to stop the research and development. what is the case is getting in

on autonomous vehicles. >> thank you and we remind you you can see more on bloomberg.com. >> obama has outlined details of a budget that would raise taxes on corporations and it sets him on a course of conflict with congress. with more, here is peter in washington. >> dead on arrival is how they describe the latest spending plan. they see the budget as a reflection of the presidents priorities in addressing income inequality in america. he proposed sequestration cuts. the middle cut paid for it with tax hikes on the healthy -- on the wealthy. corporate america foots much of

the bill. the spending plan does not bring down the deficit or make it worse. >> i want to work with congress to replace austerity with smart investments to strengthen america and we can do so in ways that are fiscally responsible. i am not going to except a budget announcement on sequestration going forward. it would be bad for our security and our growth. >> there is an area of potential compromise. the corporate tax reform has been implemented and it could could -- it could create the start of negotiations. there is a lot less than the 35% they could face on current law. going forward, there is a tax on

future rates and it is part of proposals along the same lines. compromise here is in the rome of possibility and the rest is a tough sell to the republicans. administration officials will head to capitol hill to make their case. >> you can join the conversation this morning on twitter. let us know what you think. mark is at mark barton. >> digital but -- additional business. we will speak to the one now after two minutes. stay tuned.

>> welcome back to countdown. in a world where google and apple ridge in billions in profit, how can entrepreneurs even begin to think about competing? she is julie meyer, the ceo. great to have you with us. i read that you will bring 600

people interested in technology together and the headline is that it is war. is it a battle cry or a serene moment? having an idea, challenging the world, or moving your idea forward. which wins. >> we chose the quote because it's so much of the entrepreneurship is a real battle and it is never giving up. the reason why we are positioning it against results last week is that people have the wrong view of who the enemy is today. the davids are not trying to kill goliath. they are trying to partner. the goliaths are creating network effects apple, network, google. if i am a retailer, i have to

look at my real competitors and the tech firms. and, i have to have a playbook for dealing with that. what we are trying to encourage is david and goliath today it's and give them a playbook and a toolkit for doing that. it is different. >> that is fascinating. we were covering google and huber and the relationship between. it is a goliath. now, are they friends? friend mace? -- frenemies? >> i think the time of the platform businesses that were created was over and we would not see anything come from

startup. what they have done is created a new platform with huge amounts of money and it is interesting because it shows the industrial landscape, taxis, and it shows that the way we do that in silicon valley, raising hundreds of billions of dollars and the way we do that in europe is different because there are a lot of good companies enabling the taxi industry and not disrupting it and ripping it up. they are enabling and extending the interest and it is a real difference between how we do it. i think they are ahead and the challenge is how to accelerate and get people to embrace what is happening anyways with the digital distraction. >> you talk about google and the judo move.

>> i am fascinated with what i perceive to be silly ways of talking about what we are doing to google in europe. we are going to shut it down. we are going to break it up. we are going to worship it. the best way to compete in war is to use the energy that the person coming at you uses against them. we are playing business model games and they impose the business model on the ecosystem. you have to come up with a better business model. what i articulated is they do not incentivize people economically for the use of the consumer data. they use the data and do not live us anything driving market capitalization. the judo move is to recognize that our data is the new entrant to the business model and the

large nontraditional businesses that decide to economically incentivize consumers in all sorts of ways now, i want you to be embedded in our business, and so forth. google does not get any challenge because people are saying, "do we worship them? " >> there is an article about who can create the next killer app. there is an idea about banking and data storage is doing well. it will challenge amazon by offering that and that has been live. >> she is brilliant and is a dynamic leader. i think those are the tights --

the types of things that i love the thinking of. it is wrong to say, the banks are there and the echo system economics will be the same. there is a core competence of managing data well and i bet all of the competitors do not. others will be doing other things well and that is the kind of leadership. what do we do well? what our strengths are as an organization. >> is that smart copycat? >> what does it matter? >> i am just curious. >> it says a lot about me. you should imitate success. imitate what is successful and decide how to adapt that to your situation.

to me, it is clear which companies are successful. as a venture capitalist, i do not just want to imitate. i want to look deeply at what we do well here and understand what they do and apply it to this landscape to figure out how we do world-class. >> a topic is e-commerce enabling. what you mean? any company that has not thought about selling their wares is behind the curve. >> when they said, this is the new thing, it is the thing of, are we on 2.0? they are selling into the shop and one of them is a portfolio company that is very simple and

says, you are online, shopping wherever you are. 400 other women have bought that beautiful blue dress and you are surprised. does it influence people? it is a huge conversion tool. the commerce that was pioneered was the longest for furniture. we have one of the earliest investors in yahoo! and the new monetization of data that was relevant to digital identity. so, we have all of these entrepreneurs extending commerce into the new world. >> we wish you success with today and with david and goliath. i like it. it is war. good luck.

now, coming up, the stories of the day are about digital. including what exxon could be a winner with oil.

>> welcome back to the countdown. let's have a look at our

favorite choices from the flurry. >> i will go with a touch of tech and amazon. most all, or part of the application. they look to buy some of the stores and show the hardware off. the phone did not do exceptionally well. this is going back to bricks and mortar for technology and delivery. you cannot be in it. >> exxon. it could be a big winner in the oil crash. >> explain. >> despite the big plunge in oil prices they are reporting profit. yes a lot of it is the work

with conoco phillips and this essentially says they are paving the way for a repeat of the 1990's and it was touted many times. price stalled and demand stalled. no company is better placed than on sitting on nearly $5 billion in cash and equivalent. >> how are americans spending the windfall from cheap gas? vegas is the title. goldman sachs says it equates to a tax cut of $125 billion for the u.s. economy and much of it gets spent and not saved. people are driving more and taking more holiday.

>> we will have breaking numbers from bp headquarters. all of that and more after the break. stay with us.

>> crude cuts. bp expected to cut spending as oil prices plunge. we will be speaking to the ceo this morning. >> the central bank cuts interest rates to a new low. rick retreat. the country is backed off from calling for a debt write-down. instead proposing swaps for growth linked bonds. >> budget\. president obama's $4 billion spending plan sets of a fight with congress. >> giving middle class families

the security they need to get ahead in the new economy. >> welcome to "countdown." >> let's get straight to bp. >> bp is pay a quarterly dividend to. to shareholders the dividend is sacrosanct. it is secretary to the oil companies as well and ap is paying its dividend. it said it will do that when it spoke to the market for months ago and it will do that. that is the first headline from bp. its fourth-quarter adjusted profit $2.4 billion bp

interestingly has been on an adjusted probability estimate basis. these oil companies are going through a tough time. we have had layoffs and drilling delays, more than $40 billion in spending cuts from the big oil players as oil companies scramble to ensure they have got enough cash on hand to essentially continue paying out dividends and bp is continuing to pay out its dividends. the big oil giant said yes today. exxon mobil raised its annual dividend but accented cut its share purchases for the current quarter to a 14 year low. that was yesterday. what is interesting is organic

capital expenditure 20 $2.9 billion. the company has seen about 23 -- 23 billion as of the third quarter. some interesting headlines from bp. the dividend is in line with estimates. what is your early take on these figures? >> he has been a street for his expectation is they would come in with $1.6 billion for the fourth quarter and they have two in a quarter. that is a decline from the previous fourth-quarter which was $2.8 billion. just like we with conical philip synnex on an chevron, a profit decline on the back of declining oil prices. oil fell $37 in the fourth quarter. dividend, they kept the dividend as expected.

investors like that. that is sacred for most of the oil companies. the question for mr. deadly when we speak with him, how long can he do that because we got the statement here and in the statement he says he expects the oil price will stay low for the near and medium term. in an interview he said that can be anywhere from anywhere to one to three years. and the statement he said he will have to be -- they will have to reset. they intend to spend $23 billion in 2015. if they say anything less than that then that would be a revision of their capital spending. >> we are just getting the details on the capital spending as you are speaking. phase are at $20 billion in

2015. just slightly below those projections and just slightly below last year's capital expenditures. >> that is not very dramatic reduction from 22 to 20 or 23. that -- you have to feel for bob dudley. how far should the cut capital spending at this point, not knowing were the oil price is going to go. it is something that they have cut back on periodically over the last year and a half. that is the final number. that -- we will be talking to him at 9:15 a.m. this morning and i will definitely ask them about capital spending and the dividend, how long he can protect it. they have a 20% stake.

a lot of speculation that bp code could be on the receiving end of m&a activity in 2015. back to you. >> looking forward to that interview. ryan will be speaking to bob dudley. you will not want to miss that interview. >> we are getting breaking news from the u.k. telecoms sector. saying they are on track to deliver the 4% revenue growth in 2015. this is the lower end of market expectations. they do say that they are on track to deliver 2017 targets. they have reduce that to minus

1.2% in the third quarter. let's get more on those numbers. joining us now. great to speak to you this morning. give us some clarity on where you are guiding expectations. you say you remain on track to deliver the target but ebitda could be lower than market expectations. >> our -- we are on track to be at least 4% so you can see it is accelerating in the fourth quarter. we do expect profits to be toward the lower end of market expectations in part because of our acquisition that we completed a few weeks ago. in part because some of the cost savings that come with improving our customers experience are coming slightly slower than expected. you can see that they are coming

because of our turn coming down. it is the lowest ever turn we have reported. lower than before the board began. thanks what are those things that are coming lower than expected, help us understand more about what you could not foresee earlier on or at the end of last year that you can now. >> two things. we decided to move some of the people working on the program to the migrations of the customers that we have acquired so that is a good thing as we have made most -- both of those acquisitions in the last six months and these systems and process changes take time. you can see that they are working because fewer people are leading us. it has taken longer to remove the costs so there is some double running costs. >> let's talk about consolidation in the industry. it is happening all around you. these talks are ongoing. you have a deal in terms of your

mobile product. what impact does this have on the way you're doing business? >>'s results show that we are ideally placed to see the value for money provider. we have seen the strongest everett take of tv mobile and fiber in the business's history. a number -- if you look in december we took 11% market share, larger than vodafone or tesco mobile. that is what you see today. fiction mentioned in your statement that the market is underpinned by a pro competition regulatory environment for the rick snyder allows such deals, do you want that to be subject to some kind of conditions, you

need the regulator to take action to preserve competition? >> neither of those deals have been confirmed so it is a bit early to be commenting. we would expect the competition all authorities to look at mergers carefully and make sure that we sustain the environment we have had. it is important that british consumers see their prices come down and not go out as a result of consolidation. >> how many is there for? >> i know that there is a long term future. we're expecting to continue accelerating. >> your market caps on around 2 billion pounds.

can a business your size survive in that kind of market? >> eating the little guy in a market full of the companies is not a problem. we have been extremely successful ever since we began. we have a larger business even though we have been in the business for two and half years say do not have to be a great big laugh to be a successful value for money business. >> how big are you going to be less than 2% of the u.k. market. how quickly will that change, do you think westerberg >> we are at -- we sell all four products. 30% of customers take tv in 30% chick mobile. we are excited about it. we do not view this as a defensive play. we can save our customers money.

>> thank you for joining us this morning. >> a little bit more breaking news for you. this is the number three natural gas here in the u.k. a big shift in terms of writing down the value of assets and these are not going to be cash write-downs but a write-down on the value of the assets in the fourth quarter. it came in in an impairment charge. capital expenditure will be lower. this is the scene. this is following up and we have -- they are spending around $67 billion going forward. that is down from the original guidance of $8 billion to $10 billion. cutting the capital expenditure writing down the value of assets , fourth-quarter revenue for bg

dropped by 19%. that comes in at $4.4 billion. in terms of the dividend this is also less for the fourth and final quarter of the year. the market had anticipated -- this will be 14.3 seven cents. that is less if you are a shareholder in less than what the market had estimated. they have had problems in brazil in the north sea along with egypt. in terms of production, they are ramping up according to bloomberg intelligence with a wrapup program. especially they will ramp up their production of liquefied natural gas as a $20 billion project and waiting for ceo. the former ceo arrives to take the helm. it is with a real strategic

direction for considerable time. impairments, write-downs, lower dividends. the hallmarks and the results of weaker energy prices. >> let's take a look at our other stories. corporate's are not the only one reacting. they cut its interest rate to 2.5% overnight. joining a double -- easing policy this year on deflation risks. >> president obama has sent congress a $4 billion -- $4 trillion budget. not eliminating the annual budget deficit. analysts say it is likely congress will approve the proposals. >> the budget the congress has in its hands is built on those values. it helps working families'

paychecks go farther and -- as the economic priorities that they are. americans are given the chance to upgrade so they can earn higher wages. this is free for responsible students. unless -- as well as expanded access to faster internet and new markets for goods made in america. >> news corp. will not be prosecuted in the u.s. in relation to the phone hacking scandal. the u.s. department of justice has been investigating whether any of the hacking had taken place in america. it looked into whether a list payments of officials had broken

any anticorruption laws. they are not pursuing any charges and closing their investigation. >> google is developing a rival to the app uber. a board member has seen screenshots of the app. google ventures invested but it seems like the companies might become competitors rather than allies. you can see more on the rival to over -- uber. >> a feast of earnings to get your teeth into.

coming up, another lumber exclusive. >> we will be talking about renault and russian. launching a new model. that is after the break. ♪

>> renault has launched its new crossover vehicle.

it will be built in spain. and at a new plant in china. the chief executive carlos gomez has been speaking exclusively to bloomberg about the decline of the russian auto market. it declined by one third in two years. >> this is not the first decline this year. this will be followed by a forecast decline of 20% which is one third of the market. it is already pretty bad. for the forecast we have in 2015, we should be hopefully at the end of the tunnel but you never know. >> apple sold $6.5 billion in bonds. that is the fourth major debt offering in the past two years. apple issued the equivalent of $39 billion in bonds in april 2013. the proceeds will be used for

stock purchases, dividends, and then repayments. lenovo has searched the most in a year in hong kong trading. profits beat analyst estimates busted by smartphones fails. motorola mobility expanded the share of global smartphone markets and that has ventured to the bottom line. that income was $253 million in the quarter that ended in december. >> let's get back to our top stories. cutting the interest rates to a record low. let's bring our next guest. we have been paid less results -- bp's results. capital expenditure will be reduced. it is recent to hold -- visit

the reason to hold interest in energy company? would>> it is one of the major reasons to own. if the price stays muted. bp has said that is it. >> is there something about oil companies that they preserve the dividend at almost every cost? pixie is right. -- >> he is right. >> not idea [indiscernible] they will do this. costs are going through the

roof. the capex spend is inevitable to get an excessive new production. costs are rising and the underlying commodity is falling. that is not a nice legs and the assets cannot be -- and makes and the assets cannot be sold. that is not a plan either. >> the -- just give us your view on the consolidation and who could default. >> the balance sheet looks healthy. you have lots of leverage and there was a heck of a lot of are we going on and equity ratings.

that is the particularly nice because not all that has gone on the balance sheets. it is a needle in a haystack and there has been a lot of exuberance about funding these businesses and a lot of potential damage. a lot of these will not get there. half the month we do not see any reserves on the oil balance sheet. it is highly speculative. in discussing consolidation in some cases of what? makes who has --the bonds will reissue. you get a price every six months based on the current offer. if it is around that level. they have been declining for quite a while for the past six

months. you have got to be wary. 13% of the market is perhaps more relevant there. that is causing some serious concerns. you will lose some money in that space. we were talking about 50 still bouncing around. it is sufficient to upset the american fracking industry and it is comfortable for those at low cost producers. that makes a lot of sense for a lot of people. it cannot be long-term bearish. all the things you have to do to find oil is at a larger cost space. we still have all demand. it is not like there was a massive glut of it. you still are two or 3 billion barrels off the mark. >> we all have seen those

adverts. >> the easy stuff has been caught. it is harder to get to. >> leading into that this sets us up to talk about central banks and what they're doing. >> disinflation. >> thanks. president obama is attempting to drive a wedge with his budget. that is all to come on "countdown." 7:26 a.m. here in london. ♪

>> you are watching "countdown." glenn stevens wanted a lower curtsy for christmas and did he get it. you have the aussie dollar trading at i-5 and after low. -- trading at a low. the dollar remains over valued to its fundamentals. this is the message from the rba. a lower exchange rate is needed. where have we heard that before?

the reserve bank would cut rates which was a shock to the polls we had out there. please feel free to take this currency down to $.70. it seems to be the sentiment. this is the biggest drop since 2013. begin is rising and the dollar is down. what you have is the yen rising and the dollar is down. everyone else is on picking pattern that the bank of japan has laid out. everyone else -- 13 institutions , some of them the biggest in the world. undermining the work, losing its listening superiority. that is the end. the indians they want to see what the new governor the new head of india will do in terms

of -- of a budget. what you have is no change 31 out of 41 that we pulled said that would be the case. and lending more to the real economy. morgan stanley say that you will get rates down at 6.5% by the end of the year. you have a nice move in turns of the dollar rupee. >> these are the bloomberg top headlines. president obama has outlined a fortune in dollar budget, one that sets him on course for conflict with the republican-controlled congress. it would spend more on infrastructure and housing. >> america cannot afford -- and i will not allow it. the budget i have sent is fully paid for through a combination

of smart spending cuts and tax reforms. >> news corp. will not be prosecuted in the u.s. in relation to the phone hacking scandal. the u.s. department of justice had been investigating whether any of the hacking had taken place in america and looked into whether alleged payments to public officials had broken anticorruption laws. the department said it is not pursuing any charges in closing its investigation. finance minister of greece outlined plans for a debt swap. grace proposed exchanging bonds. the coalition government had been calling for the euro area to write down debt. >> can the fed really raise

rates? >> they will blink. even if it is tokenism. the market is still saying that. it is tokenism. you have a debt laden world. it is hard to conceive that they are -- there will be a secular trend. >> is it to restore faith in capitalism? >> it would make sense. as australia has done and they have been forced to reverse course. the answer to the question is this overload stimulus process and it is creating.

axis. it is a drug. it is feeding spending habits. look at the comments last week pointing out that -- what happens until next time we see a downturn. you will have a crisis of confidence because people go, what next? it is clear why you should be trying to give yourself some headroom. it does make logical sense. they are a commodity economy. and china and the slowdown is hurting them significantly. the decline is logical and why

not encourage it? that is back to the deflation argument. you create that spiral which is unfortunate. does that work in a debt laden world? >> japanese government bonds and german government bndunds have opened today. they are using less than japanese government bonds. that is saying something very prophetic. the bank of japan will have to move on their rates again. >> the time the last change quite well. they waited for the worst of the

news to come out last year. they are doing 80%. it is a big number. it is a lot of stimulus. it has not been that impressive and it goes back to the point. when did qe become the q4 economic growth? there is no other evidence. this far you have raised inflation rates, not wages. has it really been effective? all it has done is heard the one thing you did not want to do which is to raise the cost of living in japan. that has been a result of energy prices going back so that will adjust slightly. the fact is it has not been effective with a country that has a full employment rate and you're not getting wage growth read you have to challenge the orthodoxy.

they still are massively choosing not to do. it is slow and that is what will change the dynamic. >> european stocks had a good month. the biggest increase since october 2011. they had the biggest upheaval. does that divergence continue? >> qe was going to -- it was selling out of the -- europe and back to the u.s. qe was all you needed and a sniff of that was going to encourage money and that is still the game. the hope and expectation. i do not think -- you will see some sort of gain. this is the last month then things have moved up.

i cannot see -- maury about the strong dollar later. it is impacting the larger companies in the u.s., you can see that. that is the thing to worry about later in the year. i do not think it is yet. >> why do you make of greece, talking about what is going on in europe? you are laughing when i was reading the story about how they are wanting to exchange debt now and bring in these new debt products that are linked to growth rather than taking haircuts on existing -- forcing investors to take haircuts on existing debt. >> this is the most important thing they blinked first. maybe that is not quite it. this is not what we should be doing and he is right.

he is correct. very little is in private hands. it is the decision of the european authorities in why don't they do something about this? it is crazy. the same numbers, they did not make sense and kick the can down the road or it is two years. it will be a bit longer. it has been quite logical. that is more than most european countries. what is the point when they are allowed off for good behavior? >> they need to collect more taxes. >> the germans have a great driver for that. we have to give some slack some way. they have -- they need to be careful. less countries -- the concept is

back in economic growth. it is kicking and down the road. >> join us on twitter, the stories that are following -- grabbing your attention. coming up today, the greek bond market is crashing away. ♪

>> the greek bond market is flashing red. this is the chart showing the difference or the spread between the three year and 10 year government bonds. traditionally, short dated bonds have a lower yield than long dated bonds. this is not happening in greece where the curve is inverted and it has been so since december. that is the red circle. above the white line shows that the three year yield is higher than the 10 year yield. below the white line, the three-year yield is lower which traditionally it should be. what this tells us, investors are worried that greece would repay its obligations in full.

if you look at the performance over the last week since those concerns are increasing by the day. and that the difference in yields is evidence of that. the yield of the three-year bond has risen almost 900 basis points from 10.7 to 19.6% from the election through monday. on the 10 year, the yield has risen 250 basis points from 8.4 to 10.9%. that means spread from there to there has jumped from 1.6% or 166 basis points so you can see right there 8.6 or 800 65 -- 865

basis points in six trading days. even though the three-year bond has registered the bigger losses since the election, the rise in the 10 year government bond yields last week was the most since may 2012 and finally we know what happened that year. the world's biggest ever bond restructuring took place. the greek bond market is flashing red. keep an eye. >> president obama has outlined details on the four train dollar budget, one that would raise taxes on corporations and top earners. it is a package that set him on a course of conflict with the republican-controlled congress. here is peter cook in washington. >> dead on arrival. that is how top republicans described the latest spending plan. the white house sees the budget

as a reflection of the president's priorities especially when it comes to addressing income it -- inequality. it totals nearly $4 trillion. he is offering tax relief for the middle-class paid for in part by tax hikes and the wealthy. he wants to just $470 billion on infrastructure and asks corporate america to foot much of that bill. the spending plan does not make it worse. the budget direct with a warning from the president. >> that is why want to work with congress to replace mindless austerity which -- with smart investments that strengthen america, and we can do so in a way that is fiscally responsible. i am not going to accept a budget loss to sequestration. it would be bad for security in bed for our books. >> there is one area of potential compromise infrastructure.

he has tried to type corporate risk -- tax reform to infrastructure but this is his most detailed plan to date. it could provide the starting point for negotiations with republicans. it is a lot less than the 35% hit the could face under current law. he is calling for a minimum of 19% tax rate on future foreign earnings with her companies decide to bring that money home or not. despite an overhauled they are already -- there are bipartisan proposals with different rates. compromise here is in the realm of possibility. the rest of the budget will be a tough sell to republicans. administration officials will hit capitol hill to make their case. >> 7:48 a.m. we will take a short break. you are looking at a live shot of london. you might see some snowy rooftops.

it does not look like it is snowing but it is maybe a bit more like sleep. we will take a short break. we will have more on google. ♪

>> welcome back. 7:51 a.m. in london. let's talk about the story where focusing on. a new threat its own investor google. google looking to get in on the business that uber has made its own. >> the story is that google has backed uber. a quarter of a billion dollars is what they funded. these guys are working together.

maybe google will end up buying uber. that could be a cohesive move. but google is preparing their own ride paying service possibly in their driverless cars. there has been other reports of their saying this is getting sensationalized. google has a right sharing app to make life easier to get home. why would they not be putting this sort of app together? it is something they have been building themselves. this is something that is showing what has been a key friendship. it is a bit more like friendly's -- frenemies.

>> everyone is pitching their tent in everyone else's that garden. >> we heard executives talking about the future of economist vehicles and that basically puts taxis and you and i having our own cars in business. it does not make sense. if anyone can hail a car that is driverless, whiners would we need to hate for taxis or our own vehicles? it is a sharing economy. labor -- uber has been thinking about this. the app that users use is powered by google's maps data. uber had announced a partnership which is a university and they

are developing an uber advanced technology center. everyone is getting on each other it is notable that they could be trying to get rid of the google exec on their board. >> moving to the cloud. and the chairwoman taking from her father making huge changesover -- over from her father making huge changes. my competitors are google apple facebook. they have more cash and less

regulation. >> thanks for that. "on the move" is next in they will be speaking to the man who led the debt negotiations in 2012. you do not want to miss it. ♪

>> good morning. welcome. we are in the city of london and moments away from trading. they want to swap that for greek bonds and greeks back down from a debt write-down. the currency remains overvalued and austria becomes the 13th nation this year with monetary policy. forcing a cut in spending in just over an hour.

bloomberg will speak to the man running the company, bob dudley. a lot to talk about. i have futures higher. the futures are in positive territory. i am looking at a snowy london. manus cranny has the market open. >> haircut. we are going to rechristened the debt swap and you can share the fruits of the restructured labor . that is the message coming. keep an i on switzerland. exports have dropped just before christmas. energy companies have delivered numbers that have beat and that drives the markets because